REG - Hays PLC - Half-year Report
22/02/2024 07:00
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RNS Number : 0077E Hays PLC 22 February 2024
HAYS PLC
HALF-YEAR
REPORT
SIX MONTHS ENDED 31 DECEMBER 2023
22 February 2024
DECISIVE ACTIONS TAKEN IN CHALLENGING MARKETS. FOCUSED STRATEGY TO IMPROVE
MEDIUM-TERM PROFITABILITY & GROWTH, UNDERPINNED BY OPERATIONAL EXECUTION
Six months ended 31 December 2023 2022 Reported LFL
(In £s million)
growth
growth
Net fees ((1)) 583.3 651.9 (11)% (9)%
Operating profit (before exceptional items) ((2)) 60.1 97.0 (38)% (37)%
Conversion rate ((3)) 10.3% 14.9% (460) bps
Profit before tax (before exceptional items) ((2)) 55.5 94.0 (41)% (40)%
Profit before tax 27.6 94.0 (71)% (70)%
Cash generated by operations ((4)) 67.3 66.4 1%
Basic earnings per share (before exceptional items) ((2)) 2.37p 4.11p (42)%
Basic earnings per share 0.77p 4.11p (81)%
Core dividend per share 0.95p 0.95p -
Note: unless otherwise stated all growth rates discussed in this statement are
LFL (like-for-like), YoY (year-on-year) net fees and profits, representing
organic growth of continuing operations at constant currency. WDA =
working-day adjusted.
Dirk Hahn, Chief Executive, commented:
"As previously reported, the half-year saw increasingly challenging
conditions, with a clear slowdown in most Perm markets in December, while our
larger Temp & Contracting business again showed greater resilience. We
acted decisively to drive consultant productivity, better align our operations
to market conditions and opportunities, and reduce costs. Consequently, we
delivered £30 million of annualised savings between August and December and
are on track to deliver a further c.£20 million in H2.
This said, I am not satisfied with our profit performance. Our focused
strategy targets the many structural growth opportunities we see, while
driving profitability through increased resilience, operational rigour and
enhanced execution. We will also be guided by our 'Golden Rule' for our
businesses, namely that operating profit growth should exceed fee growth,
which in turn should exceed headcount growth through the cycle. As our end
markets stabilise and then recover, I am confident we can return to, and then
exceed, our previous peak profits. While our markets today are challenging,
and we are making some difficult decisions, Hays is a strong business with a
great team of talented colleagues, and I am excited about what we can achieve
together".
• Group fees down 9%, with Temp more resilient and down 3% (down 2% WDA((5))),
and Perm down 15%. As reported at our Q2 results, overall trading slowed
through H1, particularly in December, and H1 pre-exceptional operating profit
decreased by 37% to £60.1 million (down 33% WDA((5)))
• Decisive actions taken and Group headcount down 9% YoY. We restructured Group
management and operations in several regions and accelerated back-office
efficiency programmes, which drove a £12.6 million exceptional charge((2)).
Our H1 actions will deliver £30 million in annualised cost savings, with a
further c.£20 million expected in H2
• Strong balance sheet and cash generation with net cash of £66.9 million and
H1 cash conversion((4)) of 112%. The Board proposes an unchanged FY24 interim
dividend of 0.95 pence per share
• New Year Temp & Contracting Return to work volumes are building in line
with prior year in the UK and Australia, although are 2% behind prior year in
Germany. Perm remains tough overall, with slower decision-making impacting
time-to-hire
• Our focused strategy targets the many structural growth opportunities we see
and is designed to increase our business resilience, quality of earnings and
cash generation through the cycle. Our long-term vision is to be recognised as
the leading business in Talent and Workforce Solutions globally
• Five strategic levers target the most in-demand job categories, higher salary
roles and most resilient end-markets, while growing our proportion of non-Perm
fees and continuing to build stronger relationships with clients &
candidates
• Enhanced operational execution & delivery will underpin our strategy and
help increase profitability towards our medium-term Group conversion rate
target of 22-25%. We will drive consultant productivity in excess of
inflation, with greater use of dynamic pricing, technology tools & data.
We have identified efficiencies from greater consistency of operating models,
and we will better leverage our overhead costs
(1) Net fees comprise turnover less remuneration of temporary workers and other
recruitment agencies.
(2) H1 24 operating profit is presented before exceptional costs of £27.9
million. This comprised £12.6m relating to restructuring of Group management
and our operations in several regions, plus back-office functions. The
remaining £15.3 million non-cash exceptional charge related to the partial
impairment of goodwill in our US business.
(3) Conversion rate is the conversion of net fees into pre-exceptional operating
profit.
(4) Cash generated by operations is stated after lease payments of £26.2 million
(2022: £24.6 million). Cash conversion represents cash generated by
operations divided by pre-exceptional Group operating profit.
(5) Due to the timing of public holidays, our largest market of Germany had two
fewer working days in H1 24 versus H1 23 which had a £3.5 million net fee and
operating profit impact.
(6) Underlying Temp margin is calculated as Temp net fees divided by Temp gross
revenue and relates solely to Temp placements in which Hays generates net
fees. This specifically excludes transactions in which Hays acts as agent on
behalf of workers supplied by third party agencies and arrangements where Hays
provides major payrolling services.
(7) Represents percentage of Group net fees and pre-exceptional operating profit.
(8) Due to our internal Group reporting cycle, the Group's annual cost base
equates to c.12.5x our cost base per period. This is consistent with prior
years.
Enquiries
Hays plc
James Hilton Group Finance Director + 44 (0) 203 978 2520
David Phillips Head of Investor Relations & ESG + 44 (0) 333 010 7122
FGS Global
Guy Lamming / Anjali Unnikrishnan hays@fgsglobal.com
Results presentation & webcast
Our results webcast will take place at 8.30am on 22 February 2024. To register
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A recording of the webcast will be available on our website later the same day
along with a copy of this press release and all presentation materials.
Reporting calendar
Trading update for the quarter ending 31 March 2024 (Q3 24) 17 April 2024
Trading update for the quarter ending 30 June 2024 (Q4 24) 11 July 2024
Preliminary results for the year ending 30 June 2024 (FY 24) 22 August 2024
Hays Group Overview
As at 31 December 2023, Hays had c.12,300 employees in 249 offices in 33
countries, and our global network helps position us in the most attractive
long-term structural growth sectors. In many of our global markets, the
majority of professional and skilled recruitment is still done in-house, with
minimal outsourcing to recruitment agencies, which presents substantial
long-term structural growth opportunities. This has been a key driver of the
diversification and internationalisation of the Group, with the International
business representing 80% of the Group's net fees in Q2 24, compared with 25%
in FY05.
Our consultants work in a broad range of industries covering recruitment in 21
professional and skilled specialisms. In H1 24 our four largest specialisms of
Technology (25% of Group net fees), Accountancy & Finance (15%),
Engineering (11%) and Construction & Property (10%) collectively
represented c.61% of Group fees.
In addition to our international and sectoral diversification, in H1 24 the
Group's net fees were generated 59% from temporary and 41% from permanent
placement markets. This well-diversified business model continues to be a key
driver of the Group's financial performance.
In our 2023 employee 'YourVoice' survey, 81% of employees said they would
recommend Hays as a great place to work.
Current trading
New Year Temp & Contracting 'Return to work' volumes are building in line
with the prior year in the UK and Australia, although are 2% behind the prior
year in Germany. Perm remains tough overall, with slower decision-making
Group commentary
While we remain mindful of market conditions, our Temp & Contracting
('T&C') New Year 'return to work' has been in line with the prior year in
the UK&I and ANZ, with Germany volumes rebuilding 2% behind the prior
year. Overall Group T&C volumes are down 8% versus the prior year (Q2 24:
down 8%).
In Perm, following previously reported December weakness, we have seen New
Year job flow and activity levels in line with Q2. However, we continue to see
slower client and candidate decision-making, leading to a longer time-to-hire.
Our key markets continue to be supported by skill shortages, and we expect to
see some further fee benefit in the second half from the positive effects of
wage inflation globally, albeit at lower levels than in H1, with fee margins
stable.
There are no material working-day effects year-on-year in the second half.
However, Easter is evenly split between Q3 and Q4, while in FY23 it fell
entirely in Q4. We expect this to have a c.1-2% negative impact on net fees at
Group level in Q3 24, primarily via our Temp business, with a corresponding
benefit to Q4 24.
As previously reported, we expect total Group headcount will reduce by c.3-4%
in Q3 24 as we continue to focus on consultant productivity and deliver
further back-office efficiencies. This will further reduce our cost base per
period((8)) in H2.
Germany
New Year Temp & Contracting volumes are rebuilding 2% behind the prior
year. Overall T&C volumes are currently down 5% YoY, partially offset by
ongoing positive effects of mix and margins. Perm activity is relatively
resilient but is modestly down versus Q2.
UK&I and ANZ
New Year T&C volumes are rebuilding in line with the prior year. T&C
volumes are currently down 11% YoY in UK&I and down 17% in ANZ. Perm
markets remain tough but are broadly stable, with new job inflows in line with
Q2.
RoW
EMEA activity levels are broadly consistent with Q2 24. The Americas and Asia
are also stable sequentially.
Group Strategic & Operational update
Our focused strategy is designed to build the leading Talent & Workforce
Solutions business globally, recognised for powering progress through people.
It focuses on the many structural growth opportunities we see and is designed
to increase our business resilience, quality of earnings and cash generation.
This will allow us to return to, and then exceed, previous peak profits.
Our strategy is based on five key strategic levers. These are proven drivers
of resilient, long-term growth, having been the cornerstone of our successful
strategy in Germany, where we have grown organically from £3 million of
operating profit in 2003, to over £100 million today:
1. Grow our leading positions in the most in-demand future job categories;
2. Increase our focus on higher skilled, higher paid roles;
3. Greater focus on resilient and growing industries and markets;
4. Continue to build stronger relationships with our clients and candidates; and
5. Drive an increased proportion of non-Perm fees across our businesses.
Recognising that each Hays country faces a different starting point, we have
defined three categories of countries based on current market position,
expertise, management capability and the strength and depth of these five
strategic levers:
• Key Countries (Germany, Australia and the UK), where we have the management
expertise, scale, structure and track record to both increase our conversion
rates and materially grow each business.
• Focus Countries (Austria, France, Italy, Japan, Poland, Spain, Switzerland and
the USA) are future key drivers of long-term growth and will deliver greater
profit diversity.
• Emerging Countries represent the 22 countries in our global network. Each has
the potential to be an attractive growth market and are also important from a
network standpoint to service our Enterprise clients.
Overall, we are targeting greater fee resilience within each Hays country,
with more countries driving material profit contributions.
Enhanced operational delivery
Underpinning our strategy is an increased focus on operational execution,
which we are driving across the Group. We will improve medium-term consultant
productivity in excess of inflation, with a greater focus on dynamic pricing,
technology tools and data. We have also identified efficiencies from greater
consistency of operating models globally, and we will better leverage our
overhead costs.
For strategic levers 1, 2 and 3 we will make better use of data to track
growth in job categories and evaluate each business line's performance against
local market opportunities. We are closely tracking our progress in areas like
STEM recruitment, and the development of our pricing and average candidate
salary. For lever 4, we will assess the delivery models in place and drive
productivity further in our delivery teams. In Enterprise clients, we will
better understand the client's needs and structure, and increase our network
effect within clients to win market share. For lever 5, in addition to
non-Perm being highly complementary to many of our future job categories and
targeted resilient industries, we will closely manage our resources
in-country, and better automate our end-to-end Temp workflow, reducing
compliance and admin time, and costs.
We have accelerated our back-office efficiency programmes, to standardise and
globalise processes, removing duplicated costs and better leveraging our
shared service centres. We will also drive significant medium-term benefits
from investing in our own technology stack, working with best-in-class
partners, and bringing in the best of AI and automation into our processes
worldwide.
Outcomes
We have strong, market leading businesses, many of which are implementing our
strategy well. But we need to ensure this is happening across all countries,
and we expect all businesses to be able to deliver a conversion rate of at
least 25%. Large businesses like Germany and Switzerland, which have proven to
be resilient over time, have delivered high compound growth. However, we also
have some businesses which are volatile and more cyclical, and we have a plan
to address this. We can improve our focus on the key growth industries and job
categories of the future in all countries. And we have some business lines
which are sub-scale, and which are not profitable enough, which we are
addressing, and some may close.
Overall, we are implementing a 'Golden Rule' for all countries that operating
profit growth should be greater than fee growth, which should in turn exceed
headcount growth through the cycle. This underpins our long-term focus on
growing consultant productivity at least in line with inflation and increasing
operating leverage to drive greater profitability through the cycle, with a
medium-term Group conversion rate target of 22-25%.
H1 Financial & Operational review
Summary Income Statement
Growth
Six months ended 31 December 2023 2022 Reported LFL
(In £s million)
Turnover 3,538.4 3,839.8 (8)% (5)%
Temp 341.6 359.5 (5)% (3)%
Perm 241.7 292.4 (17)% (15)%
Net fees ((1)) 583.3 651.9 (11)% (9)%
Administrative expenses (523.2) (554.9) (6)% (4)%
Operating profit (before exceptional items ((2))) 60.1 97.0 (38)% (37)%
Operating profit (after exceptional items ((2))) 32.2 97.0 (67)% (66)%
Conversion rate ((3)) 10.3% 14.9%
Underlying Temp margin ((6)) 15.2% 15.3%
Temp fees as % of total net fees 59% 55%
Period-end consultant headcount 7,971 9,099 (12)%
H1 24: lower fees in challenging market conditions
Turnover for the six months to 31 December 2023 decreased by 5% (8% on a
reported basis). Net fees in the six months to 31 December 2023 decreased by
9% on a like-for-like basis, and by 11% on a reported basis, to £583.3
million. This represented a like-for-like fee decline of £55.1 million versus
the prior year, with the fee decline accelerating through the half-year,
including a December net fee exit rate of minus 13% WDA((5)).
The decrease in Group fees was due to lower volumes in both Temp and Perm,
partially offset by increases in our average fees per placement, which were
driven by management actions and the impact of wage inflation. The higher net
fee decline compared to turnover was due to relatively resilient performance
in Temp fees versus Perm.
Temp fees (59% of Group) were relatively resilient and decreased by 3%, or
down 2% WDA((5)). Temp volumes decreased by 7% YoY, with a further 1% decline
from fewer working days YoY, partially offset by 5% growth from positive mix
effects and higher Temp rates. Our underlying Temp margin((6)) was stable YoY
at 15.2%. Temp volumes remained stable sequentially through our second quarter
but did not benefit from our normal seasonal uplift through Q2.
Perm fees (41% of Group) decreased by 15%, with activity slowing through the
half-year. Overall, Perm volumes decreased by 25% as job inflow decreased and
hiring processes extended, notably in December. As with FY23, this was
partially offset by good growth in our average Perm fee, up 10%.
Fees in the Private sector (83% of Group), decreased by 10%, with the Public
sector more resilient, down 1%.
Our largest global specialism of Technology (25% of Group fees) decreased by
10%, with Accountancy & Finance down 6%, which included Senior Finance
hires outperforming lower salary levels. Engineering performed well and grew
by 6%, although Construction & Property decreased by 14%. Direct and
indirect outsourcing fees with Enterprise clients decreased by 5%, although we
continue to have a good pipeline of opportunities.
H1 operating profit impacted by lower fees, however decisive cost actions
taken
H1 24 pre-exceptional((2)) Group operating profit of £60.1 million
represented a like-for-like decrease of 37% (down 33% WDA((5))). Group
conversion rate((2)) decreased by 460 bps year-on-year to 10.3% (10.8%
WDA((5))). As reported at our Q2 results, given the deceleration in fees we
saw at the end of the quarter (December fees decreased by 15% on a reported
basis), the December fee slowdown directly impacted our H1 24 operating
profit.
As market conditions became more challenging, we moved decisively to align
consultant capacity to market demand and reduced consultant headcount, while
protecting our core business. Overall, Group consultant headcount in H1 24 was
decreased by 619, or 7%, and by 12% YoY, through a mix of natural attrition
and performance management. We also restructured operations in several regions
which included refocusing and delayering of management and accelerated our
back-office efficiency programmes. This led to a 3% reduction in
non-consultant headcount in Q2 24.
Since our FY23 preliminary results in August, our actions have reduced our
costs per period((8)) by c.£2.5 million, which equates to annualised Group
cost savings of £30 million. Of these savings, c.£20 million arose from the
7% reduction in consultant headcount delivered in H1. A further c.£10 million
of savings resulted from the restructuring of operations and back-office
functions, which resulted in an exceptional restructuring charge in H1 of
£12.6 million((2)), detailed below. Looking ahead, we expect our ongoing
actions will deliver further annualised Group cost reductions of c.£20
million in H2 24.
Like-for-like costs decreased by 4% YoY or £20.0million (£31.7 million on
reported basis). This was driven by a 9% lower Group headcount, lower
commissions and bonuses and reduced operational overhead spend. This was
partially offset by our own salary increases and underlying cost inflation,
notably in property and insurance costs.
Overall Group average fee productivity per consultant was solid, given market
conditions, but remained below peak levels. Productivity was supported by our
actions to manage consultant headcount, increase our fee margins and focus on
higher value roles. Market conditions meant that Group average volume
productivity per consultant was down significantly YoY, and versus
pre-pandemic levels. We remain focused on driving productivity in H2 24 and
beyond.
Exchange rate movements decreased net fees and operating profit by £13.5
million and £1.8 million, respectively. This resulted from the strengthening
in the average rate of exchange of sterling versus our main trading
currencies, notably the Australian dollar. Currency fluctuations remain a
significant Group sensitivity.
Working-day adjustments
As previously reported, our Germany business had two fewer working days versus
the prior year, which impacted our fees and operating profit by c.£3.5
million. Therefore, on a WDA basis Group operating profit was £63.6 million,
down 33% YoY, and represented a conversion rate of 10.8%. There are no
material working-day impacts in H2. However, in H2 Easter is evenly split
between Q3 and Q4, while in FY23 it fell entirely in Q4. We expect this to
have a c.1-2% negative impact on net fees at Group level in Q3 FY24, primarily
via our Temp business, with a corresponding benefit to Q4 24.
Impairment of goodwill and exceptional restructuring charge
During the half-year, the Group incurred an exceptional charge of £27.9
million (2022: £nil). Of this, £15.3 million is a non-cash exceptional
charge resulting from the partial impairment of the carrying value of goodwill
relating to the 2014 Veredus acquisition in the USA, given ongoing challenges
in the US market. The goodwill impairment charge is a material non-cash item
that based on its size and nature is considered to be exceptional. The
remaining Veredus goodwill balance at 31 December 2023 is £7.1 million
In a direct and decisive response to increasingly challenging market
conditions and a clear slowdown in most markets, we restructured the business
operations of several countries across the Group, to better align business
operations to market opportunities and reduce operating costs. The
restructuring exercise led to the redundancy of a number of employees,
including senior and operational management and back-office positions. As
reported at our Q2 results, the combined costs relating to this were £12.6
million, and are considered exceptional given their size and impact on
business operations. The cash impact of the exceptional charge in the
half-year was £6.8 million, with a further £2.5 million cash outflow
expected in the six months to 30 June 2024. We estimate that these
restructuring actions will result in c.£10 million per annum in longer-term
cost savings, which are included in the overall £30 million of annualised
cost savings resulting from our H1 actions.
Net finance charge
The net finance charge for the half-year was £4.6 million (2022: £3.0
million). The increase YoY was primarily due to a £0.8 million charge on
defined benefit pension scheme obligations (2022: credit of £0.4 million),
and is non-cash. Net bank interest payable (including amortisation of
arrangement fees) was £1.3 million (2022: £1.3 million). The interest charge
on lease liabilities under IFRS 16 was £2.4 million (2022: £2.0 million),
and the Pension Protection Fund levy was £0.1 million (2022: £0.1 million).
We expect the net finance charge for FY24 to be c.£9 million, modestly higher
YoY driven by higher non-cash items of c.£6 million.
Taxation
Taxation for the half-year was £15.3 million (2022: £27.3 million),
representing a pre-exceptional((2)) effective tax rate (ETR) of 32.0% (2022:
29.0%). The increase in the ETR year-on-year is primarily driven by the
geographic mix of operating profit, notably the impact of Germany, which has
one of our highest country tax rates and which accounted for 68% of group
profits in the half-year. We expect the Group's ETR will be c.32% in FY24.
Earnings per share
The Group's pre-exceptional basic Earnings per share (EPS) of 2.37p was 42%
lower than the prior year. The reduction was primarily driven by 37% lower
pre-exceptional operating profit. In addition, we incurred a modestly higher
net finance charge and a higher ETR, both noted above. The impact on EPS was
partially offset by a 2.1% reduction in average shares in issue, resulting
from our FY23 share buyback programme.
Strong balance sheet and cash generation
Our net cash position at 31 December 2023 was £66.9 million. We converted
112% of operating profit((2)) into operating cash flow((4)), significantly up
YoY (2022: 68%((4))). We saw a working capital outflow of £3.6 million in the
half-year (2022: £44.3 million outflow), with a reduction in our Temp debtor
book offset by a decrease in payables, and a modest increase in debtor days to
36 days (2022: 35 days), due to the timing of customer payments and geographic
mix of business. Debtor days remain below pre-pandemic levels.
Cash tax paid in the half-year was £28.5 million (2022: £33.2 million) and
included some pre-payments to certain tax authorities. Net capital expenditure
was £13.7 million (2022: £12.3 million), with continued investments in
technology infrastructure and cyber security. We expect capital expenditure
will be c.£30 million in FY24.
Company pension contributions were £9.1 million (2022: £8.8 million) and net
interest paid was £1.3 million (2022: £1.4 million). The cash impact of the
exceptional restructuring charge in H1 24 was £6.8million.
During the half-year we paid a £32.6 million final core dividend for FY23 and
a special dividend of £35.7 million. During the half-year we also purchased
£12.3 million in shares under our Treasury share buyback programme announced
in September 2023, which has been completed.
Retirement benefits
The Group's defined benefit pension scheme position under IAS 19 at 31
December 2023 has resulted in a surplus of £26.4 million (30 June 2023:
surplus of £25.7 million). This £0.7 million increase in surplus was driven
by employer contributions of £9.1 million, plus higher-than-expected return
on the scheme assets, partially offset by a decrease in the discount rate
adopted within the key financial assumptions, which increased the calculation
of the schemes' liabilities.
During the half-year, the Group contributed £9.1 million of cash to the
defined benefit scheme (2022: £8.8 million), in line with the agreed deficit
recovery plan. The 2021 triennial valuation quantified the actuarial deficit
at £23.9 million on a Technical Provisions basis. Our long-term objective
continues to be reaching full buy-out of the scheme and therefore our recovery
plan remained unchanged and comprised an annual payment of £16.7 million from
July 2021, with a fixed 3% uplift per year. The scheme was closed to new
entrants in 2001 and to future accrual in June 2012.
Capital allocation
Our business model remains highly cash generative. The Board's free cash flow
priorities are to fund the Group's investment and development, maintain a
strong balance sheet, deliver a progressive, sustainable and appropriate core
dividend and to return any surplus cash to shareholders through a combination
of special dividends and share buybacks, subject to the economic outlook.
The Board has declared an unchanged interim core dividend of 0.95 pence per
share, reflecting our strong financial position and the Board's confidence in
the Group's strategy. This represents pre-exceptional dividend cover of 2.5x,
within our target core full year dividend cover range of 2.0 to 3.0x earnings.
The ex-dividend date is 29 February 2024, and our dividend payment date will
be 9 April 2024.
Our policy for returning surplus cash to shareholders remains unchanged and is
based on paying capital above our cash buffer at each financial year-end (30
June) of £100 million, subject to the economic outlook. We have a strong
track record of paying cash to shareholders, with c.£950 million in core and
special dividends paid in respect of FY17 to FY23, and additionally £93.2
million of share buybacks since April 2022.
Foreign exchange
Overall, net currency movements versus sterling negatively impacted results in
the half-year, decreasing net fees by £13.5 million, and operating profit by
£1.8 million, primarily due to the strengthening of sterling versus the
Australian dollar.
Fluctuations in the rates of the Group's key operating currencies versus
sterling represent a significant sensitivity for the reported performance of
our business. By way of illustration, based on our H1 24 results, each 1 cent
movement in annual exchange rates of the euro and Australian dollar impacts
net fees by c.£4.9 million and c.£0.8 million respectively per annum, and
operating profits by c.£1.2 million and c.£0.1 million respectively per
annum.
The rate of exchange between the Australian dollar and sterling over the
half-year averaged AUD $1.9205 and closed at AUD $1.8661. As at 20 February
2024 the rate stood at AUD 1.9271. The rate of exchange between the euro and
sterling over the half-year averaged €1.1587 and closed at €1.1517. As at
20 February 2024 the rate stood at €1.1690.
The strengthening of sterling versus our main trading currencies of the euro
and Australian dollar is currently a headwind to Group operating profit in
FY24.
Movements in consultant headcount and office network changes
Consultant headcount at 31 December 2023 was 7,971, down 12% year-on-year and
7% lower than June 2023. Total Group headcount decreased by 9% year-on-year.
We expect total headcount will decrease by c.3-4% in Q3 FY24, as we continue
our focus on improving productivity and managing our overall cost base.
Consultant headcount 31 Dec 31 Dec Net change 30 Jun Net change
2023
2022
(vs. 31 Dec
2023
(vs. 30 Jun
2022)
2023)
Germany 2,055 2,072 (1)% 2,044 1%
United Kingdom & Ireland 1,800 2,082 (14)% 1,935 (7)%
Australia & New Zealand 887 1,110 (20)% 1,071 (17)%
Rest of World 3,229 3,835 (16)% 3,540 (9)%
Group 7,971 9,099 (12)% 8,590 (7)%
We consolidated several smaller locations, meaning our office network
decreased by a net three locations in the half-year.
Office network 31 Dec 30 Jun Net change 31 Dec
2023
2023
(vs. 30 Jun
2022
2023)
Germany 26 26 - 26
United Kingdom & Ireland 85 85 - 87
Australia & New Zealand 38 39 (1) 39
Rest of World 100 102 (2) 103
Group 249 252 (3) 255
Germany (32%((7)) net fees, 68%((7)) operating profit)
Resilient performance, with operating profit up 3% WDA((5)) despite a tougher
economic backdrop
Growth
Six months ended 31 December 2023 2022 Reported LFL
(In £s million)
Net fees ((1)) 186.2 180.2 3% 3%
Operating profit ((2)) 40.8 43.2 (6)% (6)%
Conversion rate ((3)) 21.9% 24.0%
Period-end consultant headcount 2,055 2,072 (1)%
Our largest market of Germany saw net fees increase by 3% to £186.2 million.
Operating profit decreased by 6% to £40.8 million, mainly due to two fewer
working days in H1 24 versus the prior year, which as previously reported
impacted fees and profit by £3.5 million. Adjusting for two fewer working
days, fees increased by 5% and operating profit growth was 3%. Conversion rate
was 21.9% (2023: 24.0%), or 23.4% WDA((5)). Currency impacts were minimal in
the half-year.
We have delivered this growth despite German GDP declining over the last 18
months, highlighting the relative resilience of demand for skilled Contractors
and Temps, driven by talent shortages. At the specialism level, our largest
specialism of Technology (33% of Germany fees), decreased by 3%, with
Engineering, our second largest, up 11%. Accountancy & Finance and
Construction & Property increased by 4% and 6% respectively, with HR flat.
Fees in our Public sector business (15% of Germany fees) increased by 16%.
Temp and Contracting, (82% of Germany fees), increased by 3%, or up 5%
WDA((5)). This was driven by 1% growth in volumes and 5% from the positive
impact of price and mix, partially offset by 2% from two fewer working days
and 1% from slightly lower average hours worked. Pricing and mix remained
solid in the half-year and is expected to remain a positive tailwind in H2 24,
albeit at lower levels than H1. As previously reported at our Q2 results, Temp
and Contracting volumes were sequentially stable through H1, however we did
not see our normal seasonal volume increase in Q2.
Perm, 18% of Germany fees, increased by 2%. This included a 10% increase in
our average Perm fee, partially offset by 8% lower Perm volumes.
Consultant headcount decreased by 1% year-on-year and increased by 1% in the
half.
United Kingdom & Ireland (20%((7)) net fees, 9%((7)) operating profit)
Markets slowed sharply through the half-year, particularly in Perm,
significantly impacting profit
Growth
Six months ended 31 December 2023 2022 Reported LFL
(In £s million)
Net fees ((1)) 118.1 136.9 (14)% (14)%
Operating profit ((2)) 5.7 15.2 (63)% (63)%
Conversion rate ((3)) 4.8%
11.1%
Period-end consultant headcount 1,800 2,082 (14)%
In the United Kingdom & Ireland ("UK&I"), net fees decreased by 14% to
£118.1 million. Operating profit of £5.7 million represented a decrease of
63% versus the prior year, and a conversion rate of 4.8% (2023: 11.1%).
Perm markets slowed materially through the half-year, impacted by negative GDP
and decreased client and candidate confidence, with Temp remaining broadly
stable sequentially, but down YoY. Our UK&I costs decreased by 8%, driven
by headcount reductions, and costs will reduce further in H2 as a number of
restructuring projects complete. However, given the pace of decline in fees
through the half-year, we incurred negative operating profit leverage,
particularly in Q2, amplified by December's fee exit rate of minus 20%.
Temp (56% of UK&I), decreased by 11%, with Temp volumes also down 11% and
the mix of price and margin flat YoY. Our Perm business saw fees decrease by
17%, with volumes down 28%, partially offset by an 11% increase in average
Perm fee. The Private sector (67% of UK&I fees) declined by 18%, with the
Public sector down 3%.
All UK&I regions traded broadly in line with the overall UK&I
business, except for Yorkshire & the North, down 5%, and Scotland, down
20%. Our largest region of London decreased by 18%, while Ireland declined by
6%. Direct fees with Enterprise clients were more resilient, up 9%.
Our largest UK&I specialism of Accountancy & Finance decreased by 10%,
with Construction & Property down 11%. Technology and Office Support
decreased by 26% and 21% respectively.
Consultant headcount decreased by 14% year-on-year and decreased by 7% in the
half.
Australia & New Zealand (13%((7)) net fees, 11%((7)) operating profit)
Markets slowed sharply through the half-year, particularly in Perm,
significantly impacting profit
Growth
Six months ended 31 December 2023 2022 Reported LFL
(In £s million)
Net fees ((1)) 74.3 99.9 (26)% (19)%
Operating profit ((2)) 6.4 17.8 (64)% (60)%
Conversion rate ((3)) 8.6% 17.8%
Period-end consultant headcount 887 1,110 (20)%
In Australia & New Zealand ("ANZ"), net fees decreased by 19% to £74.3
million, with operating profit down 60% to £6.4 million. This represented a
conversion rate of 8.6% (2023: 17.8%). Currency impacts were negative in the
half-year, decreasing net fees by £8.5 million.
Cost decreases of 10% were driven by 15% lower average consultant headcount in
the half-year, partially offset by our own cost inflation. Having changed our
ANZ leadership team in H2 23, we continued to take decisive action to improve
our performance. We undertook a restructuring of the business, focusing on
improving consultant productivity and driving operational efficiencies. We
also conducted a full review of operational management capacity, which we
aligned to market conditions. This said, the pace of decline in fees through
the half-year meant we incurred negative operating profit leverage, which was
amplified by the further slowdown in December.
Temp (63% of ANZ) decreased by 15%, with volumes down 17%, but remained
sequentially stable through the half-year. Fees continued to be impacted by
the Federal government's policy decision to reduce the use of Temps in the
Public sector, and by reduced activity in some large Enterprise clients. Perm
fees decreased by 25%, with volumes down 21% and slowing through the
half-year, including a particularly difficult December. The Private sector
(62% of ANZ fees), declined by 22%, with Public sector fees down 13%.
Australia, 92% of ANZ, saw fees decrease by 18%. New South Wales and Victoria
decreased by 22% and 19% respectively. Queensland fell by 11%, with ACT down
22%. At the ANZ specialism level, Construction & Property (19% of fees),
decreased by 24%, with Technology down 20%. Accountancy & Finance
decreased by 16%, although Banking and HR were less impacted, down 11% and 9%
respectively. New Zealand fees decreased by 26%.
ANZ consultant headcount decreased by 20% year-on-year and decreased by 17% in
the half.
Rest of World (35%((7)) net fees, 12%((7)) operating profit)
Slowing markets in EMEA and challenging conditions in China and the Americas
negatively impacted operating profit
Growth
Six months ended 31 December 2023 2022 Reported LFL
(In £s million)
Net fees ((1)) 204.7 234.9 (13)% (11)%
Operating profit ((2)) 7.2 20.8 (65)% (65)%
Conversion rate ((3)) 3.5% 8.9%
Period-end consultant headcount 3,229 3,835 (16)%
Fees in our Rest of World ("RoW") division, which comprises 28 countries,
decreased by 11%. Fees in Temp (37% of RoW) were resilient and flat YoY, with
Perm down 16% as markets slowed through the half-year. Operating profit
decreased by 65% to £7.2 million, with RoW operating costs down 6% YoY,
representing a conversion rate of 3.5% (2023: 8.9%). Currency impacts were
negative in the half-year, decreasing fees by £5.1 million and operating
profit by £0.1 million.
EMEA ex-Germany (63% of RoW) fees decreased by 4%. France, our largest RoW
country, delivered flat fees, however activity slowed through the half-year.
Belgium and Spain increased by 6% and 1% respectively, and the UAE delivered
record fees, up 26%. Switzerland and Poland decreased by 4% and 23%
respectively. In response to market conditions, we reduced EMEA ex-Germany
headcount at the end of the half-year.
The Americas (21% of RoW) fees decreased by 26% and with tough conditions
throughout the region. The USA declined by 26%, Latin America by 27% and
Canada by 28%. Given the extent of the fee declines, the Americas was modestly
loss-making in the half-year.
Asia (16% RoW) fees decreased by 14%, with China down 22%. Japan and Malaysia
decreased by 2% and 5% respectively. Overall, we made a small operating profit
in Asia, however Mainland China was modestly loss-making.
In response to market conditions, we restructured our Americas and Asia
businesses, including a right-sizing and de-layering of operational
management, and a reduction in non-fee earner headcount. Overall consultant
headcount in the RoW division decreased by 16% year-on-year. EMEA ex-Germany
consultant headcount decreased by 10%, the Americas decreased by 33% and Asia
was down 10%.
Purpose, Net Zero, Equity and our Communities
Our purpose is to benefit society by investing in lifelong partnerships that
empower people and organisations to succeed, creating opportunities and
improving lives. Becoming lifelong partners to millions of people and
thousands of organisations also helps to make our business sustainable. Our
core company value is that we should always strive to 'do the right thing'.
Linked to this and our commitment to Environmental, Social & Governance
(ESG) matters, Hays has shaped its Sustainability Framework around the United
Nations Sustainable Development Goals (UNSDG's), and further details can be
found in our FY23 ESG report
(https://www.haysplc.com/~/media/Files/H/Hays/ESG/esg-report-fy23.pdf) .
Treasury management
The Group's operations are financed by retained earnings and cash reserves. In
addition, the Group has in place a £210 million revolving credit facility,
which reduces in November 2024 to £170 million and expires in November 2025.
This provides considerable headroom versus current and future Group funding
requirements.
The covenants within the facility require the Group's interest cover ratio to
be at least 4:1 (ratio as at 31 Dec 2023: 177:1) and its leverage ratio (net
debt to EBITDA) to be no greater than 2.5:1 (as at 31 December 2023 the Group
held a net cash position). The interest rate of the facility is on a ratchet
mechanism with a margin payable over Compounded Reference Rate in the range of
0.70% to 1.50%.
As at 31 December 2023, £125 million of the committed facility was undrawn
(31 December 2022: £120m of the committed facility was undrawn).
The Group's UK-based Treasury function manages the Group's currency and
interest rate risks in accordance with policies and procedures set by the
Board and is responsible for day-to-day cash management; the arrangement of
external borrowing facilities; and the investment of surplus funds. The
Treasury function does not operate as a profit centre or use derivative
financial instruments for speculative purposes.
Principal risks facing the business
Hays plc operates a comprehensive enterprise risk management framework, which
is monitored and reviewed by the Board. There are a number of potential risks
and uncertainties that could have a material impact on the Group's financial
performance and position. These include risks relating to the cyclical nature
of our business and inflation, business model, talent recruitment and
retention, compliance, reliance on technology, cyber security, data
protection, contracts and the covid pandemic. These risks and our mitigating
actions are set out in the 2023 Annual Report
(https://www.haysplc.com/~/media/Files/H/Hays/annual-reports/ar-2023/Hays%20Annual%20Report%20And%20Accounts%202023.pdf)
, and remain relevant. There are no additional risks since this date which
impact Hays' financial position or performance, although as noted earlier in
this statement, with macroeconomic uncertainties increasing, we are closely
monitoring our activity levels and KPI's.
Responsibility Statement
We confirm that, to the best of our knowledge:
• the unaudited condensed Consolidated Interim Financial Statements have been
presented in accordance with IAS 34 "Interim Financial Reporting" and give a
true and fair view of the assets, liabilities, financial position and profit
for the Group;
• the interim management report includes a fair review of the information
required by DTR 4.2.7R (indication of important events during the first six
months of the financial year and their impact on the condensed financial
statements, and description of principal risks and uncertainties for the
remaining six months of the financial year); and
• the interim management report includes a fair review of the information
required by DTR 4.2.8R (disclosure of related parties transactions in the
first six months of the financial year and any changes in the related parties
transactions described in the last Annual Report).
This interim report was approved and authorised for issue by the Board of
Directors on 21 February 2024.
Dirk
Hahn
James Hilton
Chief Executive
Group Finance Director
Hays plc
20 Triton Street
London
NW1 3BF
haysplc.com/investors
Cautionary statement
This Preliminary Report (the "Report") has been prepared in accordance with
the Disclosure Guidance and Transparency Rules of the UK Financial Conduct
Authority and is not audited. No representation or warranty, express or
implied, is or will be made in relation to the accuracy, fairness or
completeness of the information or opinions contained in this Report.
Statements in this Report reflect the knowledge and information available at
the time of its preparation. Certain statements included or incorporated by
reference within this Report may constitute "forward-looking statements" in
respect of the Group's operations, performance, prospects and/or financial
condition. By their nature, forward-looking statements involve a number of
risks, uncertainties and assumptions and actual results or events may differ
materially from those expressed or implied by those statements. Accordingly,
no assurance can be given that any particular expectation will be met and
reliance shall not be placed on any forward-looking statement. Additionally,
forward-looking statements regarding past trends or activities shall not be
taken as a representation that such trends or activities will continue in the
future. The information contained in this Report is subject to change without
notice and no responsibility or obligation is accepted to update or revise any
forward-looking statement resulting from new information, future events or
otherwise. Nothing in this Report shall be construed as a profit forecast.
This Report does not constitute or form part of any offer or invitation to
sell, or any solicitation of any offer to purchase or subscribe for any shares
in the Company, nor shall it or any part of it or the fact of its distribution
form the basis of, or be relied on in connection with, any contract or
commitment or investment decisions relating thereto, nor does it constitute a
recommendation regarding the shares of the Company or any invitation or
inducement to engage in investment activity under section 21 of the Financial
Services and Markets Act 2000. Past performance cannot be relied upon as a
guide to future performance. Liability arising from anything in this Report
shall be governed by English Law, and neither the Company nor any of its
affiliates, advisors or representatives shall have any liability whatsoever
(in negligence or otherwise) for any loss howsoever arising from any use of
this Report or its contents or otherwise arising in connection with this
Report. Nothing in this Report shall exclude any liability under applicable
laws that cannot be excluded in accordance with such laws.
LEI code: 213800QC8AWD4BO8TH08
Independent Review Report to Hays plc
Report on the Condensed Consolidated Interim Financial Statements
Our conclusion
We have reviewed Hays plc's condensed consolidated interim financial
statements (the "interim financial statements") in the Half-year report of
Hays plc for the 6 month period ended 31 December 2023 (the "period").
Based on our review, nothing has come to our attention that causes us to
believe that the interim financial statements are not prepared, in all
material respects, in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
The interim financial statements comprise:
• the Condensed Consolidated Balance Sheet as at 31 December 2023;
• the Condensed Consolidated Income Statement and the Condensed Consolidated
Statement of Comprehensive Income for the period then ended;
• the Condensed Consolidated Cash Flow Statement for the period then ended;
• the Condensed Consolidated Statement of Changes in Equity for the period then
ended; and
• the explanatory notes to the interim financial statements.
The interim financial statements included in the Half-year report of Hays plc
have been prepared in accordance with UK adopted International Accounting
Standard 34, 'Interim Financial Reporting' and the Disclosure Guidance and
Transparency Rules sourcebook of the United Kingdom's Financial Conduct
Authority.
Basis for conclusion
We conducted our review in accordance with International Standard on Review
Engagements (UK) 2410, 'Review of Interim Financial Information Performed by
the Independent Auditor of the Entity' issued by the Financial Reporting
Council for use in the United Kingdom ("ISRE (UK) 2410"). A review of interim
financial information consists of making enquiries, primarily of persons
responsible for financial and accounting matters, and applying analytical and
other review procedures.
A review is substantially less in scope than an audit conducted in accordance
with International Standards on Auditing (UK) and, consequently, does not
enable us to obtain assurance that we would become aware of all significant
matters that might be identified in an audit. Accordingly, we do not express
an audit opinion.
We have read the other information contained in the Half-year report and
considered whether it contains any apparent misstatements or material
inconsistencies with the information in the interim financial statements.
Conclusions relating to Going Concern
Based on our review procedures, which are less extensive than those performed
in an audit as described in the Basis for conclusion section of this report,
nothing has come to our attention to suggest that the directors have
inappropriately adopted the going concern basis of accounting or that the
directors have identified material uncertainties relating to going concern
that are not appropriately disclosed. This conclusion is based on the review
procedures performed in accordance with ISRE (UK) 2410. However, future events
or conditions may cause the group to cease to continue as a going concern.
Responsibilities for the interim financial statements and the review
Our responsibilities and those of the Directors
The Half-year report, including the interim financial statements, is the
responsibility of, and has been approved by the directors. The directors are
responsible for preparing the Half-year report in accordance with the
Disclosure Guidance and Transparency Rules sourcebook of the United Kingdom's
Financial Conduct Authority. In preparing the Half-year report, including the
interim financial statements, the directors are responsible for assessing the
group's ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the group or to
cease operations, or have no realistic alternative but to do so.
Our responsibility is to express a conclusion on the interim financial
statements in the Half-year report based on our review. Our conclusion,
including our Conclusions relating to going concern, is based on procedures
that are less extensive than audit procedures, as described in the Basis for
conclusion paragraph of this report. This report, including the conclusion,
has been prepared for and only for the company for the purpose of complying
with the Disclosure Guidance and Transparency Rules sourcebook of the United
Kingdom's Financial Conduct Authority and for no other purpose. We do not, in
giving this conclusion, accept or assume responsibility for any other purpose
or to any other person to whom this report is shown or into whose hands it may
come save where expressly agreed by our prior consent in writing.
PricewaterhouseCoopers LLP
Chartered Accountants
London
21 February 2024
Condensed Consolidated Income Statement
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) Note (unaudited) (unaudited) (audited)
Turnover 2 3,538.4 3,839.8 7,583.3
Net fees ((1)) 2 583.3 651.9 1,294.6
Administrative expenses ((2)) (523.2) (554.9) (1,097.6)
Operating profit before exceptional items 2 60.1 97.0 197.0
Exceptional items ((3)) 3 (27.9) - -
Operating profit 2 32.2 97.0 197.0
Net finance charge 4 (4.6) (3.0) (4.9)
Profit before tax 27.6 94.0 192.1
Tax ((4)) 5 (15.3) (27.3) (53.8)
Profit after tax 12.3 66.7 138.3
Profit attributable to equity holders of the parent company 12.3 66.7 138.3
Earnings per share before exceptional items (pence)
- Basic 7 2.37p 4.11p 8.59p
- Diluted 7 2.36p 4.08p 8.52p
Earnings per share (pence)
- Basic 7 0.77p 4.11p 8.59p
- Diluted 7 0.77p 4.08p 8.52p
((1)) Net fees comprise turnover less remuneration of temporary workers and
other recruitment agencies.
((2)) Administrative expenses include impairment loss on trade receivables of
£1.7 million (2022: £2.4 million).
((3)) Exceptional items for the six months to 31 December 2023 comprise
goodwill impairment of £15.3 million and a restructuring charge of £12.6
million.
((4)) The tax charge for the six months ended 31 December 2023 of £15.3
million included a £2.5 million tax credit in respect of exceptional items.
The
pre-exceptional tax charge of £17.8 million represents an effective tax rate
of 32.0% against a pre-exceptional profit before tax of £55.5 million. On a
post-exceptional basis the effective tax rate was 55.4%.
Condensed Consolidated Statement of Comprehensive Income
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Profit for the period 12.3 66.7 138.3
Items that will not be reclassified subsequently to profit or loss:
Actuarial remeasurement of defined benefit pension schemes (7.6) (76.6) (95.1)
Tax relating to components of other comprehensive income 1.8 15.1 19.5
(5.8) (61.5) (75.6)
Items that may be reclassified subsequently to profit or loss:
Currency translation adjustments 6.6 9.5 (15.6)
Other comprehensive income/(loss) for the period net of tax 0.8 (52.0) (91.2)
Total comprehensive income for the period 13.1 14.7 47.1
Attributable to equity shareholders of the parent company 13.1 14.7 47.1
Condensed Consolidated Balance Sheet
31 December 31 December 30 June
2023 2022 2023
(In £s million) Note (unaudited) (unaudited) (audited)
Non-current assets
Goodwill 8 186.1 205.1 200.3
Other intangible assets 59.6 49.6 53.7
Property, plant and equipment 27.5 29.5 29.7
Right-of-use assets 9 180.6 176.3 176.1
Deferred tax assets 21.4 20.8 21.4
Retirement benefit surplus 11 26.4 34.6 25.7
501.6 515.9 506.9
Current assets
Trade and other receivables 10 1,119.8 1,174.1 1,244.6
Corporation tax debtor 6.8 5.2 6.8
Cash and cash equivalents 13 151.9 191.4 145.6
Derivative financial instruments - - 0.1
1,278.5 1,370.7 1,397.1
Total assets 1,780.1 1,886.6 1,904.0
Current liabilities
Trade and other payables (862.0) (894.2) (991.3)
Lease liabilities 9 (45.6) (42.2) (41.3)
Corporation tax liabilities (0.8) (22.0) (16.2)
Provisions 12 (16.3) (11.5) (10.8)
(924.7) (969.9) (1,059.6)
Non-current liabilities
Bank loans 13 (85.0) (90.0) (10.0)
Deferred tax liabilities (2.9) (4.4) (2.8)
Lease liabilities 9 (149.2) (147.5) (148.5)
Provisions 12 (9.1) (8.9) (12.8)
(246.2) (250.8) (174.1)
Total liabilities (1,170.9) (1,220.7) (1,233.7)
Net assets 609.2 665.9 670.3
Equity
Called up share capital 16.0 16.2 16.0
Share premium 369.6 369.6 369.6
Merger reserve 43.8 43.8 43.8
Capital redemption reserve 3.4 3.2 3.4
Retained earnings 90.6 131.4 155.4
Cumulative translation reserve 64.6 83.1 58.0
Equity reserve 21.2 18.6 24.1
Total equity 609.2 665.9 670.3
Condensed Consolidated Statement of Changes in Equity
For the six months ended 31 December 2023
(In £s million) Called up share capital Share premium Merger reserve Capital redemption reserve Retained earnings Cumulative translation reserve Equity reserve Total equity
At 1 July 2023 16.0 369.6 43.8 3.4 155.4 58.0 24.1 670.3
Currency translation adjustments - - - - - 6.6 - 6.6
Remeasurement of defined benefit pension schemes - - - - (7.6) - - (7.6)
Tax relating to components of other comprehensive income - - - - 1.8 - - 1.8
Net income recognised in other comprehensive income - - - - (5.8) 6.6 - 0.8
Profit for the period - - - - 12.3 - - 12.3
Total comprehensive income for the period - - - - 6.5 6.6 - 13.1
Dividends paid - - - - (68.3) - - (68.3)
Purchase of own shares - - - - (12.3) - - (12.3)
Share-based payments charged to the income statement - - - - - - 6.4 6.4
Share-based payments settled on vesting - - - - 9.3 - (9.3) -
At 31 December 2023 (unaudited) 16.0 369.6 43.8 3.4 90.6 64.6 21.2 609.2
For the six months ended 31 December 2022
(In £s million) Called up share capital Share premium Merger reserve Capital redemption reserve Retained earnings Cumulative translation reserve Equity reserve Total equity
At 1 July 2022 16.7 369.6 43.8 2.7 268.2 73.6 21.6 796.2
Currency translation adjustments - - - - - 9.5 - 9.5
Remeasurement of defined benefit pension schemes - - - - (76.6) - - (76.6)
Tax relating to components of other comprehensive income - - - - 15.1 - - 15.1
Net expense recognised in other comprehensive income - - - - (61.5) 9.5 - (52.0)
Profit for the period - - - - 66.7 - - 66.7
Total comprehensive income for the period - - - - 5.2 9.5 - 14.7
Dividends paid - - - - (149.9) - - (149.9)
Purchase of own shares (0.5) - - 0.5 (0.8) - - (0.8)
Share-based payments charged to the income statement((1)) - - - - - - 5.6 5.6
Share-based payments settled on vesting((1)) - - - - 8.6 - (8.6) -
Tax on share-based payment transactions - - - - 0.1 - - 0.1
At 31 December 2022 (unaudited) 16.2 369.6 43.8 3.2 131.4 83.1 18.6 665.9
For the year ended 30 June 2023
(In £s million) Called up share capital Share premium Merger reserve Capital redemption reserve Retained earnings Cumulative translation reserve Equity reserve Total equity
At 1 July 2022 16.7 369.6 43.8 2.7 268.2 73.6 21.6 796.2
Currency translation adjustments - - - - - (15.6) - (15.6)
Remeasurement of defined benefit pension schemes - - - - (95.1) - - (95.1)
Tax relating to components of other comprehensive income - - - - 19.5 - - 19.5
Net expense recognised in other comprehensive income - - - - (75.6) (15.6) - (91.2)
Profit for the year - - - - 138.3 - - 138.3
Total comprehensive income for the year - - - - 62.7 (15.6) - 47.1
Dividends paid - - - - (165.1) - - (165.1)
Purchase of own shares (0.7) - - 0.7 (19.0) - - (19.0)
Share-based payments charged to the income statement - - - - - - 11.1 11.1
Share-based payments settled on vesting - - - - 8.6 - (8.6) -
At 30 June 2023 (audited) 16.0 369.6 43.8 3.4 155.4 58.0 24.1 670.3
((1)) The Share-based payments charged to the Consolidated Income Statement
and Share-based payments settled on vesting were previously presented net as
"Share-based payments". The presentation for the six months ended 31 December
2022 has been updated to enhance the consistency and understandability of the
disclosures. There has been no change in the underlying activity.
Condensed Consolidated Cash Flow Statement
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) Note (unaudited) (unaudited) (audited)
Operating profit 32.2 97.0 197.0
Adjustments for:
Exceptional items 3 27.9 - -
Depreciation of property, plant and equipment 5.5 5.4 10.9
Depreciation of right-of-use assets 9 23.9 22.8 46.0
Amortisation of intangible assets 5.4 5.5 10.0
Loss on disposal of business assets - - 0.1
Net movements in provisions (excluding exceptional items) (2.5) (1.3) 1.9
Share-based payments 4.7 5.9 12.0
64.9 38.3 80.9
Operating cash flow before movement in working capital 97.1 135.3 277.9
Movement in working capital:
Decrease/(increase) in receivables 136.3 49.8 (53.2)
(Decrease)/increase in payables (139.9) (94.1) 24.5
Movement in working capital (3.6) (44.3) (28.7)
Cash generated by operations 93.5 91.0 249.2
Cash paid in respect of exceptional items from current year (6.8) - -
Pension scheme deficit funding 11 (9.1) (8.8) (17.7)
Income taxes paid (28.5) (33.2) (65.8)
Net cash inflow from operating activities 49.1 49.0 165.7
Investing activities
Purchase of property, plant and equipment (3.6) (5.8) (12.3)
Purchase of intangible assets (10.1) (6.5) (16.8)
Acquisition of subsidiaries - - (1.0)
Interest received 1.7 0.7 2.0
Net cash used in investing activities (12.0) (11.6) (28.1)
Financing activities
Interest paid (3.0) (2.1) (3.7)
Lease liability repayments 9 (26.2) (24.6) (49.9)
Purchase of own shares (12.3) (57.6) (75.7)
Equity dividends paid 6 (68.3) (149.9) (165.1)
Increase in bank loans and overdrafts 13 75.0 90.0 10.0
Net cash used in financing activities (34.8) (144.2) (284.4)
Net increase/(decrease) in cash and cash equivalents 2.3 (106.8) (146.8)
Cash and cash equivalents at beginning of period 145.6 296.2 296.2
Effect of foreign exchange rate movements 4.0 2.0 (3.8)
Cash and cash equivalents at end of period 13 151.9 191.4 145.6
Bank loans and overdrafts at beginning of period (10.0) - -
Increase in period 13 (75.0) (90.0) (10.0)
Bank loans and overdrafts at end of period (85.0) (90.0) (10.0)
Net cash at end of period 13 66.9 101.4 135.6
The notes on pages 22 to 29 form part of these Interim Financial Statements.
Notes to the Condensed Consolidated Interim Financial Statements
For the six months ended 31 December 2023
1 Basis of preparation
The condensed Consolidated Interim Financial Statements ("Interim Financial
Statements") are the results for the six months ended 31 December 2023. The
Interim Financial Statements have been prepared in accordance with UK adopted
International Accounting Standard 34, 'Interim Financial Reporting' and the
Disclosure Guidance and Transparency Rules (DTR) sourcebook of the United
Kingdom's Financial Conduct Authority. The Interim Financial Statements are
presented in sterling, the functional currency of Hays plc.
The Interim Financial Statements represent a 'condensed set of financial
statements' as referred to in the DTR. Accordingly, they do not include all of
the information required for a full annual financial report and are to be read
in conjunction with the Consolidated Financial Statements for the year ended
30 June 2023 which have been prepared in accordance with UK adopted
International Accounting Standards.
The Interim Financial Statements do not constitute statutory accounts as
defined in section 434 of the Companies Act 2006. The financial information
for the year ended 30 June 2023 included in this report was derived from the
statutory accounts for the year ended 30 June 2023, a copy of which has been
delivered to the Registrar of Companies. The auditor's report on these
accounts was unqualified, did not include a reference to any matters to which
the auditor drew attention by way of an emphasis of matter and did not contain
a statement under sections 498 (2) or (3) of the Companies Act 2006.
Accounting policies
The Interim Financial Statements have been prepared on the basis of the
accounting policies and methods of computation applicable for the year ended
30 June 2023. These accounting policies are consistent with those applied in
the preparation of the Consolidated Financial Statements for the year ended 30
June 2023, except as where stated below:
• The tax charge recognised for the interim period is based on the estimated
weighted average annual income tax expense for the full financial year.
The fair value of trade receivables, trade payables, financial assets, bank
loans and overdraft is not materially different to their book value.
The following new standard is mandatory for the first time in the Group's
accounting period beginning on 1 July 2023 and no new standards have been
early adopted. The Group's interim financial statements have adopted the new
standard, but it has had no material impact on the Group's results or
financial position:
• IFRS 17 - Insurance contracts (effective 1 January 2023)
The Group's accounting policies align to the requirements of IAS 1 and IAS 8.
There have been no alterations made to the accounting policies as a result of
considering all of the other amendments above that became effective in the
period, as these were either not material or were not relevant.
The Group has not yet adopted certain new standards, amendments and
interpretations to existing standards, which have been published but which are
only effective for the Group accounting periods beginning on or after 1 July
2024. These new pronouncements include:
• IFRS 16 (amendments) 'Lease accounting', on sale and leaseback (effective 1
January 2024);
• IAS 1 (amendments) 'Presentation of Financial Statements', on non-current
liabilities with covenants (effective 1 January 2024); and
• IAS 7 (amendments) 'Financial instruments', on supplier finance (effective 1
January 2024).
The Directors are currently evaluating the impact of the adoption of all
standards, amendments and interpretations but do not expect them to have a
material impact on the Group's operations or results.
Going Concern
The Group's business activities, together with the factors likely to affect
its future development, performance and financial position, including its cash
flows and liquidity position, are described in the Half-year report.
In addition, and in making this statement, the Board carried out a robust
assessment of the principal risks facing the Group, including those that would
threaten the Group's business model, future performance and liquidity. Whilst
the review has considered all the principal risks identified by the Group, the
resilience of the Group to the occurrence of these risks in severe yet
plausible scenarios has been evaluated.
At 31 December 2023, the Group had a net cash position of £66.9 million. In
addition, the Group currently has an unsecured revolving credit facility of
£210 million that reduces to £170 million in November 2024, and expires in
November 2025. As at 31 December 2023, £125 million of the committed facility
was undrawn. The net cash position is stated after deducting the amount drawn
on the RCF.
The Board approves an annual budget and reviews monthly management reports and
quarterly forecasts. The output of the planning and budgeting processes has
been used to forecast the Group's cash flow throughout the Going Concern
period, being at least 12 months from the date of approval of the Interim
Financial Statements.
The Board also considered the possible impact on the Group's financial
position in the event of a sustained loss of business arising from a prolonged
global downturn, similar in scale to the one caused by the Covid-19 pandemic
in the year ended 30 June 2020. This scenario also forecasted both a strong
net cash position and for the drawdown on the revolving credit facility to
reduce throughout the Going Concern period, with significant headroom against
its banking covenants.
In addition, the Group's strong balance sheet position and history of strong
cash generation, tight cost control and flexible workforce management provides
further protection.
The Group has sufficient financial resources which, together with internally
generated cash flows, will continue to provide sufficient sources of liquidity
to fund its current operations, including its contractual and commercial
commitments and any proposed dividends. The Group is therefore well-placed to
manage its business risks. After making enquiries, the Directors have formed
the judgment at the time of approving the Interim Financial Statements that
there is a reasonable expectation that the Group has adequate resources to
continue in operational existence throughout the Going Concern period, being
at least 12 months from the date of approval of the Interim Financial
Statements. For this reason, they continue to adopt the Going Concern basis of
accounting in preparing the Interim Financial Statements.
2 Segmental information
IFRS 8, Operating segments
IFRS 8 requires operating segments to be identified on the basis of internal
reports about components of the Group that are regularly reviewed by the chief
operating decision maker to allocate resources to the segment and to assess
their performance.
As a result, the Group segments the business into four regions, Germany,
United Kingdom & Ireland, Australia & New Zealand and Rest of World.
There is no material difference between the segmentation of the Group's
turnover by geographic origin and destination.
The Group's operations comprise one class of business, that of qualified,
professional and skilled recruitment.
Turnover, net fees and operating profit
The Group's Executive Board, which is regarded as the chief operating decision
maker, uses net fees by segment as its measure of revenue in internal reports,
rather than turnover. This is because net fees exclude the remuneration of
temporary workers, and payments to other recruitment agencies where the Group
acts as principal, which are not considered relevant in allocating resources
to segments. The Group's Executive Board considers net fees for the purpose of
making decisions about allocating resources. The Group does not report items
below operating profit by segment in its internal management reporting. The
full detail of these items can be seen in the Condensed Consolidated Income
Statement.
Turnover Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Germany 989.1 940.0 1,956.3
United Kingdom & Ireland 810.4 856.5 1,714.6
Australia & New Zealand 670.9 825.7 1,583.3
Rest of World 1,068.0 1,217.6 2,329.1
Group 3,538.4 3,839.8 7,583.3
Net fees Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Germany 186.2 180.2 382.0
United Kingdom & Ireland 118.1 136.9 266.1
Australia & New Zealand 74.3 99.9 188.4
Rest of World 204.7 234.9 458.1
Group 583.3 651.9 1,294.6
Operating profit
Six months to Six months to
31 December 31 December
2023 2023 Six months to Six months to Year to
Pre-exceptional Exceptional 31 December 31 December 30 June
items items 2023 2022 2023
(In £s million) (unaudited) (unaudited) (unaudited) (unaudited) (audited)
Germany 40.8 (2.5) 38.3 43.2 100.2
United Kingdom & Ireland 5.7 (1.6) 4.1 15.2 28.7
Australia & New Zealand 6.4 (2.7) 3.7 17.8 32.1
Rest of World 7.2 (21.1) (13.9) 20.8 36.0
Group 60.1 (27.9) 32.2 97.0 197.0
3 Exceptional items
During the six months ended 31 December 2023, the Group incurred an
exceptional charge of £27.9 million (2022: £nil). Of this, £15.3 million
is a non-cash exceptional charge resulting from the partial impairment of the
carrying value of goodwill relating to the 2014 Veredus acquisition in the
USA, which was partially impaired in the year ended 30 June 2020. The goodwill
impairment charge is a material non-cash item that based on its size and
nature is considered to be exceptional. The remaining Veredus goodwill balance
at 31 December 2023 is £7.1 million.
In response to increasingly challenging market conditions and a clear slowdown
in most markets, we restructured the business operations of several countries
across the Group, to better align business operations to market opportunities
and reduce operating costs. The restructuring exercise led to the redundancy
of a number of employees, including senior and operational management and
back-office positions and the closure of several offices. Effective 31 August
2023, after 16 years of service, Alistair Cox stepped down as CEO and from the
Board. The combined costs relating to this were £12.6 million, and are
considered exceptional given their size and impact on business operations. The
cash impact of the exceptional charge in the half-year was £6.8 million, with
a further £2.5 million cash outflow expected in the six months to 30 June
2024.
In total the exceptional charge generated a tax credit of £2.5 million (2022:
£nil).
The last time that the Group recognised an exceptional restructuring charge
was in the year ended 30 June 2020, in the immediate aftermath of the Covid-19
pandemic.
4 Net finance charge
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Interest received on bank deposits 1.7 0.7 2.0
Interest payable on bank loans and overdrafts (3.0) (2.0) (3.7)
Interest on lease liabilities (2.4) (2.0) (4.2)
Pension Protection Fund levy (0.1) (0.1) (0.1)
Net interest on pension obligations (0.8) 0.4 1.1
Net finance charge (4.6) (3.0) (4.9)
5 Tax
The Group's consolidated effective tax rate for the six months ended 31
December 2023 is based on the forecasted pre-exceptional effective tax rate
for the full year of 32.0% (31 December 2022: 29.0%, 30 June 2023: 28.0%). The
tax rate is higher than the UK statutory tax rate of 25.0% due to higher tax
rates in a number of jurisdictions in which the Group operates.
The tax charge for the six months ended 31 December 2023 of £15.3 million
included a £2.5 million tax credit in respect of the exceptional charge. The
pre-exceptional tax charge of £17.8 million represents an effective tax rate
of 32.0% against a pre-exceptional profit before tax of £55.5 million. On a
post-exceptional basis the effective tax rate was 55.4%.
The net deferred tax balance at 31 December 2023 is an asset of £18.5 million
(31 December 2022: asset of £16.4 million, 30 June 2023: asset of £18.6
million).
On 20 June 2023, Finance (No 2) Act 2023 was substantively enacted in the UK,
introducing a global minimum effective tax rate of 15%. The legislation
implements a domestic top-up tax and a multinational top-up tax, effective for
accounting periods starting on or after 31 December 2023. The Group applied
the exception under the IAS12 amendment to recognising and disclosing
information about deferred tax assets and liabilties related to top-up income
taxes.
6 Dividends
The following dividends were paid by the Group and have been recognised as
distributions to equity shareholders:
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Final dividend for the year ended 30 June 2022 of 1.90 pence per share - 30.8 30.8
Special dividend for the year ended 30 June 2022 of 7.34 pence per share - 119.1 119.1
Interim dividend for the period to 31 December 2022 of 0.95 pence per share - - 15.2
Final dividend for the year ended 30 June 2023 of 2.05 pence per share 32.6 - -
Special dividend for the year ended 30 June 2023 of 2.24 pence per share 35.7 - -
Total dividends paid 68.3 149.9 165.1
The final dividend for the year ended 30 June 2023 of 2.05 pence per share and
the special dividend for the year ended 30 June 2023 of 2.24 pence per share
were paid out of retained earnings.
The proposed interim dividend for the six months ended 31 December 2023 of
0.95 pence per share is not included as a liability in the balance sheet as at
31 December 2023.
7 Earnings per share
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Earnings from operations before exceptional items 55.5 94.0 192.1
Tax on earnings from operations before exceptional items (17.8) (27.3) (53.8)
Basic earnings before exceptional items 37.7 66.7 138.3
Profit before tax 27.6 94.0 192.1
Tax on earnings after exceptional items (15.3) (27.3) (53.8)
Profit after tax 12.3 66.7 138.3
Number of shares (millions):
Weighted average number of shares 1,588.5 1,622.3 1,610.0
Dilution effect of share options 6.3 10.6 13.9
Weighted average number of shares used for diluted EPS 1,594.8 1,632.9 1,623.9
Before exceptional items (in pence):
Basic earnings per share before exceptional items 2.37p 4.11p 8.59p
Diluted earnings per share before exceptional items 2.36p 4.08p 8.52p
After exceptional items (in pence):
Basic earnings per share 0.77p 4.11p 8.59p
Diluted earnings per share 0.77p 4.08p 8.52p
Reconciliation of earnings
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Basic earnings before exceptional items 37.7 66.7 138.3
Exceptional items (note 3) (27.9) - -
Tax credit on exceptional items (note 3) 2.5 - -
Profit after tax 12.3 66.7 138.3
8 Goodwill
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
At 1 July 200.3 202.3 202.3
Exchange adjustments 1.1 2.8 (2.0)
Impairment loss (15.3) - -
Carried forward 186.1 205.1 200.3
Goodwill arising on business combinations is reviewed and tested on an annual
basis for impairment, or more frequently if there is an indication that
goodwill might be impaired. Goodwill as at 31 December 2023 has been assessed
for triggers for impairment as required under IAS 34 and accordingly, an
impairment loss of £15.3m has been recorded in respect of the US business. At
this stage, the remaining carrying value of goodwill is £7.1 million, however
dependent upon the future impact of the current trading conditions, there is
potential for change in the key assumptions that may give rise to an
additional impairment. Refer to note 3.
9 Right-of-use assets and lease liabilities
Right-of-use assets
Motor Other Total Lease
(In £s million) Property vehicles assets lease assets liabilities
As at 1 July 2023 164.5 11.5 0.1 176.1 (189.8)
Exchange adjustments 1.7 0.1 - 1.8 (2.2)
Lease additions 21.6 5.2 - 26.8 (26.8)
Lease disposals (0.1) (0.1) - (0.2) 0.2
Depreciation of right-of-use assets (20.4) (3.5) - (23.9) -
Lease liability repayments - - - - 26.2
Interest on lease liabilities - - - - (2.4)
At 31 December 2023 (unaudited) 167.3 13.2 0.1 180.6 (194.8)
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Current (45.6) (42.2) (41.3)
Non-current (149.2) (147.5) (148.5)
Total lease liabilities (194.8) (189.7) (189.8)
10 Trade and other receivables
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Trade receivables 756.5 835.0 746.1
Less provision for impairment (20.1) (21.2) (19.1)
Net trade receivables 736.4 813.8 727.0
Net accrued income 335.2 306.5 476.8
Prepayments and other debtors 48.2 53.8 40.8
Trade and other receivables 1,119.8 1,174.1 1,244.6
The required provision for impairment of both trade receivables and accrued
income is analysed using a provision matrix to measure the expected credit
losses, in which the allowance for impairment increases as balances age.
Expected credit losses are measured using historical losses for the past five
years, adjusted for forward-looking factors impacting the economic
environment, such as the GDP growth outlook, and commercial factors deemed to
have a significant impact on expected credit loss rates. The provision for
impairment has decreased compared to 31 December 2022 in line with movement on
trade receivables.
11 Retirement benefit surplus
Six months to Six months to Year to
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Surplus in the scheme brought forward 25.7 102.0 102.0
Administration costs (1.5) (1.6) (3.2)
Employer contributions (towards funded and unfunded schemes) 9.1 8.8 17.7
Net interest income 0.7 2.0 4.3
Remeasurement of the net defined benefit surplus (7.6) (76.6) (95.1)
Surplus in the scheme carried forward 26.4 34.6 25.7
The £7.6 million loss on the remeasurement of the net defined benefit surplus
is mainly due to a decrease in the discount rate adopted within the key
financial assumptions, which increased the calculation of the schemes' defined
benefit obligation, partially offset by a higher than expected return on the
scheme assets.
In respect of IFRIC 14, the Schemes' Definitive Deeds and Rules are considered
to provide Hays with an unconditional right to a refund of surplus assets and
therefore the recognition of a net defined benefit scheme asset is not
restricted. Agreements to make funding contributions do not give rise to any
additional liabilities in respect of the scheme.
12 Provisions
(In £s million) Restructuring Legal, tax and other matters Total
At 1 July 2023 - 23.6 23.6
Charged to income statement 11.1 2.3 13.4
Credited to income statement - (4.5) (4.5)
Utilised (6.8) (0.3) (7.1)
At 31 December 2023 (unaudited) 4.3 21.1 25.4
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Current 16.3 11.5 10.8
Non-current 9.1 8.9 12.8
Total provisions 25.4 20.4 23.6
Restructuring provisions are disclosed in note 3. Of the £12.6 million
restructuring charge, £1.5 million related to early vesting on Performance
Share Plans (PSPs) and has been charged to equity.
As a global specialist in recruitment and workforce solutions and in common
with other similar organisations, in the ordinary course of our business the
Group is exposed to the risk of legal, tax and other disputes. Where costs are
likely to arise in defending and concluding such disputes, and these costs can
be measured reliably, they are provided for in the Consolidated Financial
Statements. These items affect various Group subsidiaries in different
geographic regions and the amounts provided for are based on management's
assessment of the specific circumstances in each case. The timing of
settlement depends on the circumstances in each case and is uncertain.
Management does not consider it reasonably possible that any of these balances
will materially change in the next 12 months.
13 Cash and cash equivalents
31 December 31 December 30 June
2023 2022 2023
(In £s million) (unaudited) (unaudited) (audited)
Cash and cash equivalents 151.9 191.4 145.6
Bank loans and overdrafts (85.0) (90.0) (10.0)
Net cash 66.9 101.4 135.6
The Group's £210 million unsecured revolving credit facility matures in
November 2025, although at the lower value of £170 million in its final year
due to reduced lender commitments received. The financial covenants within the
facility remain unchanged and require the Group's interest cover ratio to be
at least 4:1 (ratio as at 31 December 2023: 177:1) and its leverage ratio (net
debt to EBITDA) to be no greater than 2.5:1 (as at 31 December 2023 the Group
held a net cash position). The interest rate of the facility is based on a
ratchet mechanism with a margin payable over SONIA in the range of 0.70% to
1.50%.
As at 31 December 2023, £125 million of the committed facility was undrawn
(31 December 2022: £120 million of the committed facility was undrawn).
14 Events after the balance sheet date
There are no significant events after the balance sheet date to report.
15 Like-for-like results
Like-for-like results represent organic growth of operations at constant
currency. For the six months ended 31 December 2023 these are calculated as
follows:
Six months to 31 December Six months to
31 December Foreign 2022 31 December
2022 exchange at constant Organic 2023
(In £s million) (unaudited) impact currency growth (unaudited)
Net fees
Germany 180.2 0.1 180.3 5.9 186.2
United Kingdom & Ireland 136.9 - 136.9 (18.8) 118.1
Australia & New Zealand 99.9 (8.5) 91.4 (17.1) 74.3
Rest of World 234.9 (5.1) 229.8 (25.1) 204.7
Group 651.9 (13.5) 638.4 (55.1) 583.3
Operating profit before exceptional items
Germany 43.2 - 43.2 (2.4) 40.8
United Kingdom & Ireland 15.2 - 15.2 (9.5) 5.7
Australia & New Zealand 17.8 (1.7) 16.1 (9.7) 6.4
Rest of World 20.8 (0.1) 20.7 (13.5) 7.2
Group 97.0 (1.8) 95.2 (35.1) 60.1
16 Like-for-like results H1 analysis by division
Net fee growth/(decline) versus same period last year: Q1 Q2 H1
2024 2024 2024
(unaudited) (unaudited) (unaudited)
Germany 7% 0% 3%
United Kingdom & Ireland (11)% (17)% (14)%
Australia & New Zealand (17)% (20)% (19)%
Rest of World (11)% (11)% (11)%
Group (7)% (10)% (9)%
H1 2024 is the period from 1 July 2023 to 31 December 2023.
The Q1 and Q2 net fee like-for-like growth percentages are as reported in the
Q1 and the Q2 Quarterly Updates.
17 Disaggregation of net fees H1 2024
IFRS 15 requires entities to disaggregate revenue recognised from contracts
with customers into relevant categories that depict how the nature, amount and
cash flows are affected by economic factors. As a result, the following
information is considered to be relevant:
(unaudited) Germany United Kingdom & Ireland Australia & New Zealand Rest of World Group
Temporary placements 82% 56% 63% 37% 59%
Permanent placements 18% 44% 37% 63% 41%
Total 100% 100% 100% 100% 100%
Private sector 85% 67% 62% 98% 83%
Public sector 15% 33% 38% 2% 17%
Total 100% 100% 100% 100% 100%
Technology 33% 16% 16% 28% 25%
Accountancy & Finance 17% 20% 12% 11% 15%
Engineering 27% 2% 0% 7% 11%
Construction & Property 4% 16% 19% 9% 10%
Office Support 0% 9% 11% 5% 5%
Other 19% 37% 42% 40% 34%
Total 100% 100% 100% 100% 100%
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